California's new dealer add-on law: what changed on October 1, 2026

The add-on rules

The law is SB 766, the California Combating Auto Retail Scams (CARS) Act, signed on October 6, 2025. It took effect on October 1, 2026. Here is what it says about the extras a dealer adds to a quote.

What the law does not ban

Does California ban dealer add-ons? No. A dealer can still sell an add-on, such as a service contract, that you choose and that would benefit you, even if you never end up using it. The law bans charging for add-ons you can't benefit from and presenting an optional one as required.

That matches the FTC's September 2026 guidance for dealers, which applies in every state: an optional add-on can't be presented as required, and saying it is already installed doesn't make it required. Whether a given product is worth it depends on the product and on you; our add-on guides go through the common ones.

Other rules that show up on your quote

The 3-day right to cancel a used car

Until October 1, 2026, a California dealer only had to offer you a two-day cancellation option, for a price, on a used car under $40,000. The CARS Act replaces it with a right you don't pay for:

• It covers used cars and trucks sold or leased for $50,000 or less. It does not cover new cars, motorcycles, or a lease buyout of the car you were already driving.
• You have three calendar days, starting the day after you sign, until the dealer's close of business on the third day. If the dealer is closed that day, you get until its next open day.
• The right ends if the car has been driven more than 400 miles since you signed.
• The dealer may charge a restocking fee of 1.5% of the sale price, at least $200 and at most $600, plus $1 a mile past 250 miles, at most $150 more. It can't charge you for the right itself.
• You return the car in person during business hours, in the condition you got it (normal wear aside), free of new liens, with anything else you received in the deal.
• The dealer must cancel the contract and refund you within 48 hours (a check may take two business days to clear first). It returns your trade-in, or if it already sold it, pays you the most of the agreed trade value, what it sold for, and its fair market value, less any loan on it.
• The dealer must give you a separate disclosure titled "3-Day Right to Cancel Used Car Purchase or Lease", and the first page of the contract must say you have 3 days to cancel.

Civil Code 1784.43; restocking fee and timing in 1784.31(g) and (i).

Who the law covers

It applies to licensed California dealers selling or leasing cars, new or used. It leaves out wholesale and fleet sales, buyers who purchase five or more vehicles a year from the dealer for business use, vehicles that don't need California registration, and vehicles rated at 10,000 pounds or more. You can't sign these rights away: a waiver is void (Civil Code 1784.21).

What to say at a California dealership

• “Which of these add-ons are optional? Can you show me where the quote says I can buy the car without them?”
• “Can you send me the quote without the add-ons, so I can see the total price for the car on its own?”
• “This car is electric, so I'd like the maintenance plan with oil changes taken off the quote.”
• “I don't want the coating or the nitrogen. Please take them and their prices off.”
• “Is this a used car under $50,000? Where is my 3-Day Right to Cancel disclosure?”

If a dealer doesn't follow it

Ask for the missing disclosure or the corrected quote in writing first. If that goes nowhere, the California DMV takes complaints about dealers: file one through its CARS Act page or call 1-800-777-0133. The law's remedies add to the ones other California law already gives you (Civil Code 1784.22). This page explains the law; it isn't legal advice, and a consumer attorney can tell you what applies to your deal.